Newspaper article The Christian Science Monitor

A Decade Later, a Tempered Vision of NAFTA ; on Its Anniversary, Backers of the Landmark Trade Deal Cite More Mexican Prosperity, but Critics See Loss of US Jobs

Newspaper article The Christian Science Monitor

A Decade Later, a Tempered Vision of NAFTA ; on Its Anniversary, Backers of the Landmark Trade Deal Cite More Mexican Prosperity, but Critics See Loss of US Jobs

Article excerpt

A funny thing is popping up in Mexico's NAFTA boom cities of Tijuana, Leon, Nogales, and Ciudad Juarez: vacancies.

Industrial space that was once hotter than a jalapeno pepper is cooling as companies that flocked to Mexico in the 1990s are looking to China, Honduras, Sri Lanka, and elsewhere for lower wages and better all-around conditions. Overall, the number of jobs in Mexico's so-called maquiladora assembly plants, while still well above what they were when the revolutionary free-trade agreement took effect in January 1994, are down more than 20 percent from their peak three years ago.

It's hardly a cheery gift on NAFTA's 10th birthday. And this mixed picture in Mexico is just one factor souring the image of free trade in the presidential election year.

On the US side of the border, many textile plants are gasping their last breath - an issue that the Democratic presidential candidates, particularly Dick Gephardt, are latching onto. Another concern: Software writers and other high-tech workers who found well- paid positions in the '90s boom years are now learning the barista trade as their jobs migrate to India.

Still, the United States' free-trade accord with Chile takes effect Jan. 1, and the Bush administration is preparing to lobby Congress for approval of a recently concluded trade agreement with four Central American countries.

Putting all these elements together, proponents and critics of free trade and the broader globalization process are sparring over what NAFTA has delivered and what new agreements will produce. "There is no great enthusiasm for free trade in the US these days, and NAFTA's failure to meet the high claims and expectations that were laid out at its passage has certainly contributed to that souring," says Peter Hakim, director of the Inter-American Dialogue, a Washington-based policy center drawing on experts across the Americas.

The original expectations

NAFTA was supposed to build a division of labor that produced jobs on both sides of the border, while delivering a prosperity to Mexico that would weaken the factors that have fed Mexican emigration to the US for decades. That was a tall order that no single agreement could make good on, analysts say, especially in the complex environment of expanding globalization.

Yet plenty of pro-trade experts say Americans need to look beyond the overly grandiose expectations for NAFTA to see what expanded trade over the past decade has meant for the hemisphere.

Advocates say poverty is down in Mexico and Chile - which have gone quite far in embracing trade liberalization - while it has hung on stubbornly or in some cases expanded dramatically in countries slower to liberalize, such as Argentina. At the same time, they say wider access to the world's products has made the region's consumers better off. "There are plenty of studies out there, starting with the World Bank's, that demonstrate again and again that the countries that have done well are those that have opened up to the world economy," says Sidney Weintraub, director of the Americas Program at the Center for Strategic and International Studies in Washington.

In addition, they point to a recent World Bank report that, while crediting NAFTA for improved living conditions, also faults Mexico for not capitalizing on the NAFTA revolution. The report asserts that by completing reforms in sectors like taxation, energy, and banking, Mexico would have stayed more competitive. …

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